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HomeMy WebLinkAboutRFP - 7516 AUDIT SERVICESAddendum 1 - Page 1 of 9 ADDENDUM No. 1 SPECIFICATIONS AND CONTRACT DOCUMENTS Description of BID 7516: AUDIT SERVICES OPENING DATE: 3:00 PM (Our Clock) Extended from July 12, 2013 to July 16, 2013 To all prospective bidders under the specifications and contract documents described above, the following changes/additions are hereby made and detailed in the following sections of this addendum: APPENDIX A: Appendix A, Schedule of Professional Fees & Expenses for Additional Services, page 32 of 35 is replaced in its entirety with the new attached Appendix A. RFP Questions & Answers: See attached questions and answers. Sample Reports Attached (referenced in questions and answers): 1. Poudre River Public Library District – Report to the Board of Trustees – May 16, 2013 2. City of Fort Collins, CO – Report to the City Council – May 23, 2013 3. Poudre Fire Authority – Financial Report for fiscal year ending December 31, 2012 4. Poudre River Public Library District – Financial Report – December 31, 2012 5. Poudre Fire Authority - Report to the Board of Directors – May 23, 2013 Please contact Gerry Paul, Director Purchasing and Risk Management at (970) 221-6779 with any questions regarding this addendum. RECEIPT OF THIS ADDENDUM MUST BE ACKNOWLEDGED BY A WRITTEN STATEMENT ENCLOSED WITH THE BID/QUOTE STATING THAT THIS ADDENDUM HAS BEEN RECEIVED. Financial Services Purchasing Division 215 N. Mason St. 2nd Floor PO Box 580 Fort Collins, CO 80522 970.221.6775 970.221.6707 fcgov.com/purchasing Addendum 1 - Page 2 of 9 APPENDIX A SCHEDULE OF PROFESSIONAL FEES & EXPENSES FOR ADDITIONAL SERVICES NATURE OF SERVICE TO BE PROVIDED MAXIMUM ALL-INCLUSIVE TOTAL PRICE 2013 Audits of City, Poudre Fire Authority and Library District $ 2014 Audits of City, Poudre Fire Authority and Library District $ 2015 Audits of City, Poudre Fire Authority and Library District $ 2016 Audits of City, Poudre Fire Authority and Library District $ 2017 Audits of City, Poudre Fire Authority and Library District $ Of the Total all-inclusive maximum price for the 2013 audit, please estimate the expected costs for the services related to the Library District and the Poudre Fire Authority: • Library District $ • Poudre Fire Authority $ Proposer: Signature: Printed: Address: City/State/Zip: Phone: Email: Addendum 1 - Page 3 of 9 Addendum #1 Questions and Answers Printing, Opinions, Letters to Management/Governing Body Q1. How many financial statements need an audit opinion and report to governing body? Three - City of Fort Collins, Poudre Fire Authority, and Poudre River Public Library District. In RFP see page 7, Section 1, F, 6. and 7. Q2. Who prints the statements for the Poudre Fire Authority and Poudre River Public Library District? The auditor prints them. Q3. Does the City print and bind the CAFR or outsource this process? We outsource this process to a printing company. Q4. Please send us a copy of the Poudre Fire Authority and Poudre River Public Library District 2012 financial statements and Management letters. See attached files: Attachment 1, Attachment 3, Attachment 4, and Attachment 5 Q5. From review of the RFP it appears the scope of services includes a separate audit of the Poudre River Public Library District and Poudre Fire Authority. Would you please confirm this understanding? Do any of the other joint ventures or component units require separate audits? Yes, a separate audit is done for the Poudre River Public Library District and Poudre Fire Authority. None of the other joint ventures or component units require a separate audit. Q6. Does the City compile the financial statements for the Poudre River Public Library District and Poudre Fire Authority or is the auditor engaged to compile these statements? No, the City compiles the financial statements for the Poudre Fire Authority and the Poudre River Public Library District compiles their own financial statements. However, the auditors are responsible for printing the financial statements for the Poudre River Public Library District and Poudre Fire Authority. Q7. Does the City maintain the accounting records for all of the component units, including the Fire Authority and the Library District? Yes, the City maintains the accounting records for all of the component units, including the Poudre Fire Authority and Poudre River Public Library District. Addendum 1 - Page 4 of 9 Q8. Will the auditor prepare the financial statements for the Fire Authority and the Library District? Or, are they prepared by the City's staff? No, the City compiles the financial statements for the Poudre Fire Authority and the Poudre River Public Library District compiles their own financial statements. However, the auditors are responsible for printing the financial statements for the Poudre River Public Library District and Poudre Fire Authority. Fees Q9. Were the auditors requested to perform additional work for 2012, if so, what was this related to and what was the fee? No. Q10. Is the audit of the Fort Collins – Loveland Airport included in this RFP? No. The auditors for the City of Loveland audit the airport statements. Q11. What were the audit fees for the City, Poudre Fire Authority and Poudre River Public Library District for the 2011 and 2012 financial statement audits? What were the fees for the single audit part of the 2011-2012 audits? 2011 - $88,000 (City - $74,500; PFA - $8,100; Library - $5,400) 2012 - $89,000 (City - $75,300; PFA - $8,200; Library - $5,500) Single audit fees were part of the fees listed above. Q12. Were separate fees quoted for the Ft. Collins Downtown Development Authority? If so, please disclose those as well. No. Q13. Agreed upon procedures (AUP) in relation to the City’s cable TV franchise agreement: Can you provide some context as to the scope of work, the quantity of transactions reviewed, and/or provide a copy of the most recently issued report? Is this is a service the City will require each year, and so the single price should be for a total of 5 AUP reports? Or does the City prefer that we list a price per AUP report? No need to respond to this item. See the attached revised Appendix A. Q14. Verification of a bond escrow for a bond issue: Should this just be a price per refunding, necessary only if the City advance refunds debt? No need to respond to this item. See the attached revised Appendix A. Addendum 1 - Page 5 of 9 Q15. Arbitrage at the end of each five-year period of a bond issue: Should this just be a price per arbitrage calculation, as necessary over the course of the engagement? Or, should this be an all-inclusive price on an annual basis, or over the 5 year engagement term? No need to respond to this item. See the attached revised Appendix A. Q16. Would you please provide the audit fees for the prior three years? If available would you provide the fees disaggregated between the financial audit and the single audit and the separate audits of the Poudre Fire Authority and Poudre River Public Library District? 2010 - $86,000 (City - $72,700; PFA - $8,000; Library - $5,300) 2011 - $88,000 (City - $74,500; PFA - $8,100; Library - $5,400) 2012 - $89,000 (City - $75,300; PFA - $8,200; Library - $5,500) Single audit fees were part of the fees listed above. Q17. What was the audit cost for the December 31, 2012 engagement? 2012 - $89,000 (City - $75,300; PFA - $8,200; Library - $5,500) Single audit fees were part of the fees listed above. Q18. What was the prior year audit fee? 2011 - $88,000 (City - $74,500; PFA - $8,100; Library - $5,400) Single audit fees were part of the fees listed above. Q19. Consent letters: Should this just be a price per consent letter, on an as needed basis? No need to respond to this item. See revised Appendix A. Reasons for RFP Q20. Is the prior/current auditor banned from making proposal to this RFP, due to a mandatory rotation policy? No, they can make a proposal. Q21. Is your current auditor allowed to propose on the 2013 audit or were there issues or is this a normal rotation process for the City? Yes, they are allowed to propose. No, there were no issues. This is the normal 5 year contract rotation process for the City. Addendum 1 - Page 6 of 9 Q22. Is the prior auditor, McGladrey, LLP, allowed to bid on the engagement or is there mandatory auditor rotation? Yes, McGladrey, LLP is allowed to bid. Q23. What is the reason for the RFP? Were there disagreements with the previous auditor, or is this just a routine process? This is the normal 5 year contract rotation process for the City. Council Finance Committee Q24. Does the City have an audit committee or is the Finance Committee considered the audit committee? The Finance Committee is considered the audit committee. Q25. What is the composition of the selection committee in terms of members of management and City Council or Council Finance Committee members? The composition of the Council Finance Committee is the mayor and two members of the City Council. Due Dates Q26. The RFP page 6 item F indicates the scheduled completion date for interim field work is November 15th. The RFP page 13 item D indicates the scheduled completion date for interim work is December 15th. Which date is the preferred date of the City? December 15th Q27. On page 6 of 35 of the RFP it states that interim work should be completed by November 15. However on page 13 of 35 the date of completion for interim is December 15. Would you please clarify which the City prefers? December 15th Q28. How many auditors were on site for interim and year end and when did this take place in 2012-2013? Interim – 3 auditors; November 26-30, 2012 Year-end – 4 auditors; April 15 – May 3; 5 auditors 3 of those days. Addendum 1 - Page 7 of 9 Q29. What types of problems, if any, have been encountered during recent audits that caused delays in meeting City deadlines? No problems have been encountered during recent audits. Q30. How many auditors were onsite for both interim and final fieldwork and for how long? Interim – 3 auditors; November 26-30, 2012 Year-end – 4 auditors; April 15 – May 3; 5 auditors 3 of those days. Debt Q31. Does the City plan on any debt refunding’s or issuing new debt in 2013? Yes, URA about $11 M (refinancing intercity loans) and Utilities about $15 M (new debt) Q32. Is it anticipated that the City will issue any bonds during the year ending December 31, 2013? Yes, URA about $11 M (refinancing intercity loans) and Utilities about $15 M (new debt) Q33. Has the City issued any new debt during 2013 and/or entered into any derivative instruments during 2013? The City intends to issue the following before the end of 2013: URA (refinancing intercity loans) and Utilities (new debt). To date no derivative instruments have been issued. Grant Compliance Q34. Do you anticipate any significant changes to the SEFA on major programs? Has the City corrected the 2012 findings? No significant changes to the SEFT are anticipated. Yes, the City has corrected the 2012 findings. Q35. How many major programs under OMB Circular A-133 does the City anticipate for 2013? The City anticipates four to five major programs under OMB Circular A-133. City Financial Personnel Q36. Are there any changes in key financial personnel in the last 2 years? No Q37. Has there been any significant turnover in the accounting or finance departments? No. Addendum 1 - Page 8 of 9 Adjusting Journal Entries, Letter to Management Q38. Please provide the following for 2012: Audit journal entries Passed audit journal entries Management Letter Letter to Governance See attached files: Attachment 1, Attachment 2, and Attachment 5 Q39. Can you share a copy of any audit adjustments and passed adjustments for the 2012 audit? See attached files: Attachment 1, Attachment 2, and Attachment 5 Q40. If applicable, would you provide a copy of the December 31, 2012 management letter? See attached files: Attachment 1, Attachment 2, and Attachment 5 Q41. How many audit adjusting journal entries have been proposed, whether posted or waived, if any, and would you please provide? One audit adjusting journal entry was passed for 2012. See attached files: Attachment 1, Attachment 2, and Attachment 5 Q42. During the audit for the year ended December 31, 2012, were there any auditor proposed adjustments? If so, how many and what was the nature of the adjustments? One audit adjusting journal entry was passed. The nature was to adjust unearned revenue in the HOME fund. Q43. Did the auditor propose any material journal entries as a result of the last audit? If so, could you please give a quick explanation? One audit adjusting journal entry was passed. The nature was to adjust unearned revenue in the HOME fund. Anticipated Changes Q44. Do you anticipate the major funds to be the same in 2013 as they were in 2012? Yes Addendum 1 - Page 9 of 9 Q45. Are you currently aware of any expected change in the number of major funds, major federal programs or component units for the year ending December 31, 2013? No. Impact of New Regulations Q46. Are there any significant audit issues of the City or new regulations or standards (GASB’s) that you are concerned with for the upcoming year and beyond? How do you expect the implementation of GASB 61 (related to component units) to effect the 2013 f/s. Do you expect any changes from the 2012 presentation of the discretely and blended component units or the “potential component units” – Poudre Fire Authority and Poudre River Public Library District? No. We do not expect the implementation of GASB 61 to affect the 2013 f/s. No, we don’t expect any changes from the 2012 presentation of component units. Q47. Other than those outlined in the RFP, do you have any other specific accounting or auditing concerns regarding new regulations or standards or any overall audit concerns? No. Miscellaneous Q48. What can be improved in the audit process? The existing audit process meets all fiduciary requirements and the City is not seeking to enhance the audit process. Q49. Is there any fraud we need to know about in the current or prior years? No. Q50. Does the City have current internal control documentation of significant transaction classes (i.e. cash receipts/disbursements, payroll, etc.)? Yes.